A new scheme introduced for borrowers with bad credit

A new scheme designed for people with a bad credit profile or people with an insufficient income has been launched by the coalition Government in collaboration with the Royal Bank of Scotland.

The scheme is known as My Home Finance and it has been founded by the Government and the National Housing Federation (NHF). 10 branches are expected to be opened across the West Midlands by the end of October.

Provided this scheme turns out to be effective, the branches of My Home Finance will mushroom the UK from April 2011 and people will not have to resort to the help of loan sharks.

The scheme will charge a typical APR of 29.9 per cent. It should be indicated, however, that when the scheme is expanded throughout the UK, the interest might reach 49.9 per cent to cover costs.

According to the comments by David Orr, NHF CEO, it is hoped that these fair loans offered at reasonable prices will be a good alternative not only to loan sharks, who mercilessly prey on households experiencing financial plight, but also to doorstep lenders, who are happy to lend money to people in need at astronomically high rates of interest.
 


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